What a great summer in the real estate world. Denver is such a great city to be in and I have been very active with lots of great clients - showing them homes and helping them with their mortgage
The True Cost Of Waiting To Buy And Sell Your Home
Why is it time to buy or sell? Why is it time to "Move Up"
Mortgage rates... In my experience, the market is driven by two major things. Inventory & Mortgage Rates.
Mortgage rates quite simply cannot stay in the low 4's. When I talk to most people about when they felt our economy was at its best in the last 20 years, the answer I seem to get the most mid 90's. The Clinton years. No matter what I or you might thing, good or bad about Clinton, we can all agree the economy was pretty good.
The lowest average "Clinton" year for mortgage rates was 1998, when mortgage rates averaged 6.94%.
2013 Average rate was 3.98%
Today's rate according to Bankrate.com is 4.33%.
So what does the rate really mean to you? We all know its going to be cheaper payment with cheaper rate. But just how much?
Real Life Numbers of a 30 yr fixed mortgage:
@3.98% / per $10,000 borrowed is 47.63 a month
@4.33% / per 10,000 borrowed is $49.66 a month
@6.94% / per $10,000 Borrowed is $66.13 a month
The Average home price in Denver is $337,250
So assuming 20% down and rates above
Your average payments on your home
2012 @ 3.98% - $1284.96
Today @ 4.33% - $1339.92
1998 @ 6.94% - $1784.13
The Denver real estate market prices is up 8.5% since last year! Predictions are a 2.2% rise this year. Again what does this mean to you?
-In 2012 you would have paid an average of $312,268 for a house in Denver and paid about 3.98% interest OR $1189.77 a month
-In 2014 you should expect to pay an average of $343995 for the same house in Denver pay about 4.5% interest rate OR 1394.38 a month
Simple math- the costs of waiting from 2012 to 2014 is $31727 or $205.00 a month.
Why I think there might not be a better time: Even if prices steady, and lets be honest chances are they won't for the next few years with all the people moving into Denver. Rates will raise, maybe not to that 6.98% of 1998, but expect mid 5's to be the norm soon. When rates go up.. you loose buying power.
If your'e on the sides lines thinking... It might just be time to jump into the game. We are looking for homes for our buyers, so if you have one to sell, let's talk. If you're a first time buyer, there are programs help you now.
Simply said, we need homes to sell! The Denver Market is Booming with buyers, but we have 1000's of people sitting on the sidelines waiting to see if NOW is the time to move up. I am not sure there is going to be a better time in the future.
Let's talk soon.
To see History & Predictions of Mortgage rates: http://www.forecast-chart.com/year-mortgage-30.html
Jim Cavoto has been serving Colorado Real Estate market since 2000. Jim carries both Real Estate Employing broker level license & The Colorado Mortgage Origination License. As a rare "Native" of Col....